Nordic Alpha Partners raises €266m for its fund II, exceeding fundraising target, and size of first fund by +100%.

Nordic Alpha Partners (NAP) is pleased to announce the successful close of NAP Fund II, doubling the previous fund in size, consolidating NAP’s position as one of Europes leading Greentech growth funds, and validating the unique value creation toolkit and operational investment approach.

Copenhagen, June 26 2024 – With backing from a diversified group of international blue-chip investors, family offices and Danish industrial funds, NAP closes Fund II well-above its target amidst a challenging fundraising market.

When NAP was founded in 2017, the ambition was to target the underserved industrial Greentech growth segment with a self-developed value creation model and a highly operational investment approach. With an investment strategy and portfolio of “dark green” companies in place even before the SFDR came into force in the EU, NAP is today recognized as the first pure-play industrial GreenTech growth fund in Europe. Its investments have so far resulted in the abatement of 1.1M tonnes of CO₂ and the creation of more than 700 jobs.

The new fund is classed as an“Article 9 fund” under the SFDR (the EU Sustainable Finance Disclosure Regulation), which governs and promotes a positive impact on the environment through investments in companies that contribute substantially to a sustainable society.

GreenTech growth paradox

To date, NAP has raised close to €1bn for its funds and portfolio companies, including 90% of all IPO / green capital investments and 1/3 of all new IPO / capital stock for listings in NAP’s home country of Denmark, during the last 4 years. In addition, NAP’s portfolio has delivered an average CAGR of 65% in revenue since NAP’s entry, as well as several succesful NAP exits with over 250mEUR over the last 12 months, includeing ,  Wiferion, which was exited to Tesla, and Spirii, whichh was acquired by the CAG40 company Edenred.

The fundraising market is currently the worst it has been in decades, and NAP’s ability to double its fund size is due to a combination of the fund’s first-mover position within Greentech growth in Europe, and the validation of NAP’s operational investment approach where the majority of NAP employees and partners are solely working with active value creation, based on NAP’s unique value creation toolkit. This provides an organizational structure that allows NAP to work with targets up to one year before investing, with tools to de-risk and prepare potential assets for global expansion and capital efficient hypergrowth.

It is obvious that there is an increasing flow of capital into the green transition. However, despite this, there are still almost no Greentech growth funds due to the capex intensity and general complexity associated with rapid scaling of industrial Greentech. Overall, that gap poses a huge problem for the general green transition, as the world will not get large-scale green tech giants if they cannot be fueled through the entire financial value chain from early innovation to established global companies.

“It is clear that the way we are organized, our value creation toolkit, and our operational investment approach stand out as a new model that can release value in the complex growth phase,” says Troels Øberg, senior partner in NAP and responsible for NAP fundraising activities. “The trust and ability to attract such a long list of international blue-chip investors is a testament the overall Nordic Alpha Partners mission, position and approach to driving value within the critical and difficult growth phase”.

Strong international backing and Danish industrial heritage

As a specialist in scaling innovative GreenTech companies, NAP is pleased that Fund II has attracted early first close investments from ABN Amro, Allianz GI, EIF and Unigestion. They are now joined by German State Fund, KfW Capital.

These are notable investors on the global scene, with KfW Capital, part of KfW Group managing EUR +500bn and Allianz Global Investors managing EUR +650bn.

While NAP has focused on making its platform more international, NAP also managed to secure commitments from local Danish investors, including leading industrial funds and high-net-worth individuals. These include Novo Holdings – the controlling shareholder of Europe’s most valuable company, Novo Nordisk, Copenhagen Infrastructure Partners (CIP) – a global leader in renewable energy investments; and members of the Danish shipping family Maersk.

“This combination of limited partners and a diversified investor base is ideal for NAP, and we already see close cooperation with our Fund II investors. They all share our commitment to accelerating the green transition and the significance that especially the growth phase entail for a successful transformation and we are looking forward to the partnership,” Troels Øberg adds.

Fund II has already done three new investments – two in Sweden, namely Sunroof and Air Water Green, and STABL Energy in Germany.

Paving the way for future GreenTech unicorns

While NAP will continue to focus on GreenTech growth assets, it has expanded its scope beyond Northern Europe and taken its operational value creation methodology to a global level – not only as an integral part of its own operations – but also as a platform for the education of the talent that aspires to become the GreenTech leaders of tomorrow.

“The close of Fund II also marks a new phase for our vision to drive green transformation based on economic sustainability, which goes beyond Nordic Alpha Partners’ direct investment activities. The strong international backing provides NAP with a platform that allows us to work with an even wider scope and influence through a platform that the global GreenTech ecosystem is in desperate need of. In essence, new toolkits and models to capital efficiently manage the complexity of the green transition,” says Laurits Bach Sørensen, senior partner and responsible for value creation at NAP. “To this end, we will release the complete Nordic Alpha playbook and models later this year, enabling capital-efficient scaling and de-risking of Hard- and Greentech companies in the growth phase. In addition, we are exploring the viability of establishing an executive education based on our experience and methodology together with the world’s top ranking technical university; The Technical University of Denmark (DTU), as well as a leading US-based academic institutions. Being a green technology companies navigating through the growth phase is like operating a ship in a perfect storm. They need to simultainously manage capex intensive complex hardtech, new changing value chains and fast paced organizational and geographical expansion, and so far no academic institution have a dedicated offering that will equip board members, investors and founders with the necessary skills and language to harness and manage such complexity”.

About Nordic Alpha Partners
Nordic Alpha Partners is a Nordics and Germany-based growth equity fund established in 2017 with offices in Copenhagen and Munich. It invests in sustainable HardTech companies with the potential to pioneer and accelerate the global green transformation. NAP’s investment approach is based on a highly active and operationally supporting ownership model, which, in combination with a methodic value creation approach, enables visionary founders to scale rapidly from local players to global market leaders.

More info: https://napartners.dk/

Legal Advisor: Mazanti-Andersen

Sole Global Placement Agent: Calpa Partners

Contact

Laurits Bach Sørensen, Seniorpartner, Nordic Alpha Partners, mobile: +45 25 26 10 30